18/03/2013

The Week Ahead: RBI Reviews Monetary Policy, Google’s Eric Schmidt Visits India

Egypt’s President, Mohammed Morsi begins his four-day visit to India today. Accompanying Mr. Morsi will be a delegation of ministers and business leaders.

The Italian ambassador to India, Daniele Mancini, is expected to attend a Supreme Court hearing to explain why the Italian government did not maintain its promise to the court that two Italian marines would return to India to stand trial for murder.

 

Mahindra & Mahindra Ltd. 500520.BY +1.48% is set to launch its new electric car, the Mahindra e20, today. ((http://blogs.wsj.com/indiarealtime/2013/01/08/mahindra-launches-sun-powered-electric-car))

 

Tuesday, March 19: The Reserve Bank of India will meet to review the monetary policy. Analysts say that a cut in interest rates is likely. The policy is reviewed twice every quarter.

 

Thursday, March 21: Google Inc. GOOG -0.88%’s Executive Chairman, Eric Schmidt, is set to speak at Google’s “Big Tent Activate Summit” in New Delhi today. Other speakers include Shashi Tharoor and Sam Pitroda.

 

Friday, March 22: The fourth cricket match of the ongoing Test series between India and Australia starts at Feroz Shah Kotla stadium in New Delhi.

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Africa is land of opportunity for Microsoft

When Microsoft announced recently that it was starting a big push to grow its market in Africa, it cited the continent’s big growth opportunities, calling Africa a “game changer in the global economy.”

 

Similarly, IBM, Google, Intel, Hewlett-Packard and other tech companies in recent years also have expanded their presence in Africa.

 

As the growth of tech hardware, software or services flattens or declines in mature markets such as the U.S. and Western Europe, and markets in China, India and Russia grow increasingly competitive, many of the largest tech companies are looking to Africa.

 

“The U.S. and Europe are stagnant. China is growing but plateauing, as is India,” said Roz Roseboro, principal Middle East and Africa analyst at research and consulting firm Analysys Mason.

 

“You’ve got these big multinational companies looking at Africa and saying: ‘You’ve got growth here,’ ” she said.

 

Though situations vary from country to country, some factors have coalesced to make the continent attractive to major tech firms.The political situation in many countries has become more stable, with governments open to cooperating and forming joint projects with foreign, multinational corporations.

 

More tech infrastructure is being built, including undersea fiber optic cable systems bringing faster broadband connections to Africa’s coasts and terrestrial cables to extend the networks inland.

 

China’s government and some of its companies have invested in African infrastructure, such as electricity grids, in return for natural resources such as oil and minerals.

 

There is a growing middle class and rapid urbanization. And the population of the continent, as a whole, is young — with an average age under 20 in some countries, Roseboro said.

 

“They’re the ones who want this [tech] stuff and the most willing to pay for it,” she said. “And they’re the ones evangelizing — it’s going to be the 16-year-old student who shows his mom how to use it.”

 

Some obstacles

 

But before all that can happen, there are challenges to overcome.

 

More education and more skilled labor are needed to help build the economy and the tech ecosystem, to say nothing of the consumer and business markets.

 

Basic infrastructure is lacking. While strides have been made in increasing broadband access, most people in Africa still don’t have online access. For those who do, the connection can be slow or costly.

 

“For Microsoft to sell software, for Google to sell ads, you have to get people online,” Roseboro said.

 

In other words, to have a market to sell to, the tech companies must first invest in building the market.

 

Toward that end, many of the strategies launched by tech companies expanding their footprint in Africa also include investments in infrastructure as well as increasing Internet access, developing people’s skills and education, and establishing research and technology hubs.

 

Initiative launched

 

Microsoft launched its 4Afrika initiative last month — an effort that has the company spending an additional $75 million over the next three years over what it’s currently investing there.

 

The initiative includes working with the Kenyan government and a Kenyan Internet service provider to deliver low-cost, high-speed wireless access; getting millions of smart devices into the hands of African youths; bringing a million small- and medium-sized businesses online; providing skills training; and creating an “online hub” through which small- and medium-sized businesses can gain access to free products and services from Microsoft and others.

 

It also includes a partnership with Chinese phone manufacturer Huawei to introduce a Windows Phone, called Huawei 4Afrika, with features and apps specifically designed for the Africa market.

 

Getting a foothold in the mobile market is especially important in Africa, where, for many, a PC is too expensive and a feature phone or a smartphone is the first and possibly only computing device for many. Indeed, mobile payments — using a phone to make payments or do banking — are common in Africa.

 

Steadily growing

 

Microsoft has been in Africa since 1992 and now has about 750 employees and 11,000 channel partners there. The company’s investment has grown steadily, with a particular focus in the education sector, as well as financial services and oil and gas businesses, said Fernando de Sousa, general manager of Microsoft Africa Initiatives.

 

But now the company realizes “we need to accelerate adoption of technology, accelerate coverage across the population of Africa,” de Sousa said. “Traditionally, while we do well perhaps in urban areas, and in certain countries more than others, our ability to cover the continent has not been as broad as we would have liked or what we think the continent deserves.”

 

Other tech companies have come to the same realization.

 

Intel launched its first Intel-based smartphone in Africa — the Yolo — earlier this year. It’s also working to expand the software-development community by investing in mobile apps development and university training.

 

Google is improving Internet access, including offering technical assistance to Internet providers; granting money to organization working to expand engineering expertise to universities; and offering a fixed amount of free Internet bandwidth for up to three years to certain universities.

 

“As more Africans get online, we’re continuing our work to create an accessible and relevant Internet,” said Julie Taylor, a spokeswoman for Google Sub-Saharan Africa.

 

Eighteen months ago, HP announced it was opening new offices in 10 African countries, adding to the seven it already had, and investing in collaborations with governments, universities and communities to help develop the workforce and spur innovation.

 

IBM, which has been in Africa since the 1930s, describes it as the world’s fastest-growing region in terms of growing GDP, foreign investment, middle class, mobile usage and bank accounts.

 

In 2009, the company was in four African nations; now it’s in more than 20. It opened its 12th research center in the world in Nairobi, Kenya. Researchers there will be focusing on challenges and priorities facing African countries.

 

“We found we really needed to take our presence in Africa to the next level,” said Takreem El Tohamy, IBM’s general manager for Middle East Africa.

 

Business potential

 

Indeed, in the 15 years Jyoti Lalchandani has been tracking the Africa market for research firm IDC, the past 12 to 18 months have been among the most hectic and newsworthy in terms of the tech industry, he said.

 

Obviously, a lot of it is driven by business potential.

 

“IT [information technology] spending is growing 12 to 15 percent every year across the continent,” said Lalchandani, vice president and regional managing director at IDC Middle East, Turkey and Africa.

 

Overall, IT spending across Africa will increase from $30 billion last year to $40 billion in 2016, he said. If telecom is also included, IDC says the spending will increase from $103 billion to close to $130 billion by 2016.

 

“I think, moving forward, we’re going to hear a lot more about Microsoft’s focus on Africa,” Lalchandani said. “They realize this offers an amazing opportunity for them to grow their business.”

 

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Ex-CEO John Sculley On Apple's Innovation 'Lull'

John Sculley served as chief executive of Apple between 1983 and 1993, during which time he oversaw the ousting of Steve Jobs and a tenfold increase in Apple's sales. Sculley left Apple in 1994 -- Jobs returned several years later -- and the former Apple executive is currently managing an investment firm with his two brothers, advising entrepreneurs from Silicon Valley to Singapore and focusing on developments in health care.

 

HuffPost spoke with Sculley about the state of innovation at Apple, what might be coming next and the advice he gives to all entrepreneurs.

 

You wrote in a blog post earlier this year that Steve Jobs invented a kind of predecessor to the iPhone -- the Mac Phone -- in the 1980s. Are there any other concepts he toyed with that might materialize?

 

If he were alive today, I suspect he’d be really fascinated about what’s happening with sensors. When you look at the ability to capture all kinds of information with sensors and then customize services back to individuals, that is so Steve Jobs. That’s the kind of thing he’d have salivated over.

 

I think the next big area of product [innovation] is probably not around a television, as many are speculating -- actually, Apple TV is pretty good right now. I think it will be around wearable sensor-type products.

 

In a recent interview, you observed that Apple is experiencing a “lull in innovation.” What do you attribute that to? And how can Apple emerge from that?

I don’t think that it’s because Apple has lost its ability to innovate. My guess is that it has nothing to do with Apple at all, but with the current stage of technology.

 

Moore’s law has been completely predictable for 40 years. You really need about a generation between each of [the] big innovations and the big innovation we’re going through now is all about cloud computing. You can only surf the big wave when there are big waves, and there are moments when technology is poised for innovators to come in and do something spectacular, and then there are other moments when you just have to play out an opportunity and wait for next big wave to come along.

 

So what’s the next “big wave”?

 

Right now the big wave is mobile video. It’s suddenly practical to do very high quality video wirelessly over mobile devices and we’re just in the early days of that. And right after that comes wearable sensors with big data analytics that will get mined by innovative companies

There are just moments when all the stars are aligned for breakthrough products. Steve had a tremendous talent to be able to spot those ahead of everyone. The question is, who is going be the one to spot the next big trend, the alignment of stars? I’d bet my money on [Senior Vice President of Industrial Design at Apple] Jony Ive being the person to spot that.

 

This is the first time since your tenure as CEO -- and the period immediately following it -- that Apple has operated without Steve Jobs. What’s your advice to the company?

 

Steve left behind a great vision for Apple, a great culture and an extraordinarily talented executive team, so this is not a company in trouble, and I think Apple is getting unfairly beaten up.

 

Apple is now being challenged by the combination of Samsung and Google. I have the iPhone and iPad and Galaxy Note. Apple makes really good products, and Samsung makes really good products. It’s really a two-horse race. Where I think Apple is exposed: the price points of Apple’s products are just so high by comparison with Samsung’s. My sense is that there’s a big opportunity that Apple is either going to miss if it doesn’t bring out lower-priced products for emerging markets, or that it can end up getting and becoming huge success story if does.

 

In 1987, you helped develop the concept for Knowledge Navigator, which many have compared to Siri. What do you imagine the Knowledge Navigator of, say, 2030 looking like?

 

I suspect in that era it will be less about a product you pick up and hold in your hand like smartphone. It’ll be much more about you being personally connected to a system where things happening passively. We’ve been going through this active stage where you have to tap a screen, speak to a computer, or look at screen, and we’re so conditioned that that’s what computing is about. But we may soon be in an era where you don’t do anything, but there’ll be tech around you monitoring your health, making judgments about what it believes you like and protecting your safety.

 

You're presently working with several health care startups. What do you foresee will be the biggest change that tech catalyzes in the world of medicine?

 

The change will be even bigger than what we've seen with online banking or e-commerce. Health care missed the PC and Internet revolutions, but it can’t afford to miss the cloud and mobile revolution.

 

Sensors are at the early days of what they’ll be able to do. You're going to be able to track anything you can think of from a health standpoint. If you're driving a car, it will be totally practical in the next 5 to 10 years that you'll be able to evaluate someone’s health conditions just by monitoring them as they ride around in the car.

 

There will be major, big-brand consumer health services that will become institutions that everyone takes for granted. I'm confident that in health care we'll see consumer-branded institutions every bit as big as Walmart or McDonald's, but this time focused on health and wellness instead of selling products.

 

You mentioned you're now "mentoring" several startups. What’s the most important advice you give to entrepreneurs?

 

The easy part is getting the vision, getting people to believe in it, recruiting talent and raising money. The hard part is that disruptive innovation takes place on the edges of transformation, and it’s a thin line between success and failure. The most important skill of all is the ability to adapt and recover.

 

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